Cybersecurity technologies protect customer data in retail

by Julia Pott

In modern retail, the digital storage and availability of data has become indispensable. This increases vulnerability to cyberattacks, as these networks offer attractive targets for hackers. Strong protection of sensitive data is therefore becoming increasingly important, making modern cyber security technology an essential part of today's retail infrastructure.

The connectivity of the retail sector is constantly increasing. Communication processes between production, distribution, warehouses, shops, marketing departments and customers are being digitalised. Even within a store, checkout systems, sensors, employee tablets and customer smartphones are increasingly linked to each other and to the internet.

At the same time, the threat from cyberspace is increasing. In the second quarter of 2024, Check Point Research recorded a 30% increase in cyberattacks worldwide compared to the previous year, which meant more than 1,600 attacks per company per week. During this period, for example, almost a tenth of all ransomware attacks occurred in the retail and wholesale sectors.

A holistic cyber security strategy and continuously updated applications and processes are therefore essential to protect customer data such as payment information, addresses or birthdays. Successful cyber attacks in which sensitive customer data is read, manipulated or blocked can cost retail companies not only a lot of money, but also trust.

An essential component of cyber security is access management: this involves determining which users or systems are authorised to access certain resources or data. Multifactor authentication (MFA), which provides additional security for access to sensitive information, has proven particularly effective. Employees and authorised users must use at least a second security factor in addition to a password. One-time passwords or codes, physical access keys such as USB devices or smart cards, biometric data such as fingerprints or voice samples and software tokens can be used for this purpose. These measures make it more difficult for unauthorised persons to access sensitive data.

One of the most effective methods of protecting customer data is encryption. End-to-end encryption makes information unreadable during transmission and storage so that it can only be decrypted by authorised parties. Although data can still be intercepted in this way, making it understandable requires a great deal of effort. This is particularly important for payment information.

To protect against a variety of threats such as malware, spyware or ransomware, the use of cyber security software is essential. This includes:

Anti-malware software (e.g. antivirus software, spyware scanners or adware removers) protects systems against malware such as viruses, Trojans, worms and ransomware. It should be installed and regularly updated on all end devices, including POS systems, servers and employee smartphones and tablets. By detecting and removing malicious programs at an early stage, anti-malware software prevents unauthorised access to customer data such as payment information and sensitive data, as well as possible damage or manipulation.

Compared to traditional firewalls, next-generation firewalls (NGFWs) offer an enhanced security architecture that not only monitors network traffic, but can also recognise malicious activities and defend against them in real time. Especially in the retail sector, where a large number of transactions and data streams are processed, NGFWs offer a necessary layer of protection against cyber attacks.

Spam and phishing filters recognise and block fraudulent emails and dangerous links. These filters should be integrated into the email systems of all employees to prevent the receipt of potentially harmful messages that target sensitive data such as customer information or payment details.

Intrusion Detection and Prevention Systems (IDPS) detect unauthorised access attempts and suspicious activities in the network and ward them off. These systems should be integrated into the retailer's IT infrastructure to continuously monitor traffic and identify potential attacks in real time. Once a threat is detected, IDPS can automatically take protective measures before attacks jeopardise customer data such as payment information or personal details.

Today's retail shops are equipped with a variety of networked devices that provide valuable data, automate processes and make operations more efficient. However, these devices also work with sensitive data, making them potential targets for cyberattacks. Particularly vulnerable end devices include checkout systems, mobile point-of-sale terminals, employee tablets, electronic price tags, sensors, surveillance cameras and customer Wi-Fi hotspots. Numerous sensitive customer information is processed via these systems, including payment and credit card data, personal identification information, data on transaction history, usage behaviour or loyalty programmes, location information, user accounts and video recordings.

To reliably protect this data from cyberattacks, EDR (Endpoint Detection and Response) technology is a key component of an effective cybersecurity strategy. EDR solutions monitor end devices in real time and detect threats at an early stage so that attacks can be fended off before they jeopardise the entire network.

Effective protection of customer data in the retail sector requires the use of modern cyber security technologies and a holistic security strategy. Artificial intelligence will play a crucial role in this by analysing patterns and detecting unusual behaviour in networks or on end devices. AI systems can detect threats in real time and automatically respond to attacks. This can significantly reduce the response time to security incidents and minimise damage. In addition, IT teams in retail companies should keep up to date with the latest developments and solutions in the field of cyber security.

Equally important is a corporate culture of sensitive data management in which regular employee training is encouraged. Despite all precautions, every company should be prepared for emergencies and have a clearly defined emergency plan in place to be able to respond quickly to successful attacks.